* Gbagbo announces nationalisation of banks after run

 

By Tim Cocks and Ange Aboa ABIDJAN, Feb 18 2011

(Reuters) – Ivory Coast will re-open branches of two major French banks on Monday after announcing it was nationalising them to avert economic meltdown, the government of disputed leader Laurent Gbagbo said on Friday.

The banking system ground to a halt this week as part of the economic fallout from a dispute over the election of Nov. 28, with banks citing liquidity and security problems and shutting their doors on queues of Ivorians desperate to withdraw cash.

Gbagbo’s government announced on Thursday it would nationalise the Ivorian branches of Societe Generale (SOGN.PA) and BNP Paribas (BNPP.PA), Standard Chartered (STAN.L) and “City Bank”, an apparent reference to Citibank (C.N).

The last major international bank operating in the country, Ecobank ETIT.CI, also suspended operations on Friday. An official at the bank told Reuters: “No bank can work alone under such conditions.”

U.S. cocoa futures climbed to their highest in more than a year on Friday on the turmoil. [ID:nLDE71H1GL]

In Paris, the French Foreign Ministry condemned the planned nationalisations, saying they were illegal as they came “from authorities that have no legitimacy to make decisions in the name of the Ivorian state”.

For a Q&A on the nationalisation click [ID:LDE71H1A2]

The international community has called on Gbagbo, the country’s leader for more than a decade, to step down after United Nations-certified results showed he lost the election to rival Alassane Ouattara last year.

But he remains in power with the backing of the army.

Major Banks in the main city Abidjan were closed on Friday morning. Paramilitary forces in pickups were parked along the “Avenue des Banques”, where the main institutions have their offices, and policemen reading newspapers sat outside the entrances to a number of shuttered banks.

Ahoua Don Mello, a spokesman for Gbagbo’s government, said meetings with employees at the local units of Societe Generale and BNP Paribas would take place on Friday.

 

Source: Reuters